Life Insurance: V Philip
I don't have a life cover. I will be moving abroad in a few months. My family is going to stay back in India for at least a year. Should I buy a life cover now, or buy it once I am abroad? Can one claim against policies across countries?
The ideal time to buy a life insurance policy is the day when one gets his/her first salary or starts earning. One should take life cover as early as possible to get a good deal in terms of premium and coverage. It is advisable to take the cover from India itself since insurers in certain countries may not offer you a policy due to citizenship of a different country. Moreover, while applying for life insurance in India, you must declare in the proposal form that you would be moving abroad (destination country) and the reason for re-location. Based on these details, the insurer will price your premium accordingly. In case of a claim, you or your family can intimate the insurer from anywhere. However, it may be noted that the claim would be payable in Indian rupees only.
I am looking for a health cover. I know even life insurers offer health plans. But, as I am interested in a pure hospitalisation cover, should I consider life insurers or general insurers?
Broadly, health insurance plans are of two types, benefit-based plans and reimbursement (or indemnity) based plans. Benefit based plans provide the insured a fixed amount irrespective of the treatment costs involved, such as a critical illness plan. Reimbursement plans on the other hand, would compensate you for the expenditure on hospitalisation only. Ideally, one should have a mix of indemnity and reimbursement based health plans in his portfolio, so that non-admissible claim amounts or loss of income due to illness can be funded from these benefit based health plans. Hence, both, life and general insurance companies offer Benefit and Reimbursement based plans.
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Reports state that the sum assured of traditional products should be 10 times the premium for the policy to get tax benefits. But, the traditional plan I own (bought a few years back) promises a sum assured that is five times the premium. Can I claim tax deduction on it?
The latest changes in the tax eligibility under section 80 (C) shall be effective only for policies which are issued on or after April 1, 2012. Thus, if you have purchased a life insurance policy before April 1, 2012 where the sum assured is 5 times of the premium, you will continue to receive tax benefits on your policy hereafter.
The write is the CEO of Bajaj Allianz Life Insurance